Nomura Holdings Inc. led Japanese securities firms higher in Tokyo trading after the country’s biggest brokerage posted quarterly profit that more than tripled to the highest in seven years.
Nomura shares rose 4.1 percent, the most in more than two weeks, to 793 yen at the close. The Topix Securities and Commodity Futures Index was the best performer among 33 industry groups on the benchmark Topix, which rose 0.3 percent.
Earnings for the fourth quarter beat analysts’ estimates as brokerage commissions and investment banking fees jumped, figures from the Tokyo-based securities firm showed late last week. Prime Minister Shinzo Abe’s push to end deflation and stimulate the economy has spurred Japanese equities, improving prospects for brokerages such as Nomura, Daiwa Securities Group Inc. and SMBC Nikko Securities Inc.
“Nomura’s earnings were good enough to alleviate investors’ anxiety over its overseas operations and prove that its retail business is in excellent condition,” said Mitsushige Akino, chief fund manager at Ichiyoshi Asset Management Co. in Tokyo. “The results are symbolic of how the brokerage sector is improving.”
Net income rose to 82.4 billion yen ($840 million) for the three months ended March 31, from 22.1 billion yen a year earlier, Nomura said on April 26. The result exceeded the 56 billion yen average estimate of nine analysts.
Revenue climbed 27 percent to 720.1 billion yen. Brokerage commissions jumped 39 percent and investment banking fees rose 47 percent. Still, pretax loss from overseas widened to 42 billion yen from 24.6 billion yen a year earlier.
Daiwa, Japan’s second-largest brokerage, may tomorrow report about 25 billion yen in quarterly profit, the most in three years, according to the average estimate of analysts surveyed. Shares of Daiwa rose 5 percent to 863 yen today.
Sumitomo Mitsui Financial Group Inc., Japan’s second-largest bank by market value and the owner of SMBC Nikko, said last week that it will increase dividends after profit surged to a record last fiscal year.
Net income climbed to about 790 billion yen in the year ended March, Sumitomo Mitsui said in a preliminary earnings statement on April 26. That’s more than the 693 billion yen estimated by analysts. The stock rose 0.3 percent to 4,605 yen.
Nomura shares on April 17 fell the most in two weeks after Italian prosecutors said they aim to seize as much as 1.95 billion euros ($2.5 billion) of assets the Japanese firm holds as part of a probe into a potential cover-up of losses at Banca Monte dei Paschi di Siena SpA.
An Italian judge on April 26 rejected the request, questioning the prosecutors’ allegations of usury and fraud, a person with knowledge of the matter said.